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Universal Life Insurance

Universal Life Insurance Policies

A life insurance policy will provide you with peace of mind knowing that your family will be cared for in the event of your death. In addition to the death benefits, many of these policies can also be used as an investment vehicle to build wealth over the years. Here is a quick look at exactly what sets universal life insurance apart from all other policies and why this type of coverage might be right for you.

Understanding Permanent Life Insurance:

Universal policies are a type of permanent life insurance because they will remain in force as long as the premiums are met. While some universal policies can be purchased for a shorter period of time, they are generally kept for the policyholder's entire life. As with other forms of life insurance, the amount that will be paid to the beneficiary is determined well before the policy becomes active. Policyholders can choose almost any amount depending on the financial needs of their loved ones.

A Flexible Insurance Policy:

One of the reasons that universal policies are so popular is because of their flexibility. You will not be locked into a permanent policy with flat premiums for the rest of your life. In fact, any interest that is made can be used to keep the policy in force after it has reached a certain value. If the policyholder is financially comfortable and would like to increase their premiums, then they have the ability to add extra value to their policy. When times are tight, they can use the cash value of the policy to continue paying for the premiums.

A Cash Value Component:

Another reason that these policies are so popular is because they have an investment aspect built into them. Before the policy becomes active, you and your insurance agent can discuss the contractually stated financial index. This is the interest rate at which your policy will build wealth. In some financial climates, these investment vehicles can be a lucrative way to improve your net worth. At a certain point, the policyholder will be able to withdraw the money or take out loans against their life insurance.